What Happens When a Government Becomes Corrupt – Another Cruel Hoax on the People of AmericaBy Mickey Bearman | December 6th, 2011 | Category: Columns, Talk Smart Politics | No Comments »
People hungry, babies suffering from lack of nutrition, and families living in tents, cars, or cardboard boxes in the street. Homes with no electricity, gas, water—all cut off. Empty homes abandoned, neighborhoods destroyed. Temperatures are zero degrees in some areas, frightening winds and snow. People are cold, hungry, and in desperate conditions. More home foreclosures, short sales, and people taking what they can when they are told to leave. Unemployment everywhere—young people if possible moving in with parents (if they are lucky.) Careers destroyed, no jobs, no hiring.
Over one and a half trillion dollars in the corporate coffers—more than any time in our country’s history. Unheard of low interest rates to protect whom? You can bet the banks. They created this mess and were bailed out with taxpayer money by over one trillion dollars. Borrow at zero or one quarter percent and then loan the money at five to twenty five percent. Look at credit card interest charges and who owns these companies, the banks. Stock market propped up, derivatives still trading wildly, and hedge funds making billions of dollars. Near record or record profits being reported by United States corporations achieved mainly by firing employees.
Cuts in education, Medicaid, Medicare, Social Security, unemployment insurance, food stamps—almost all of the safety net programs. What is next, people clearing out supermarkets, department stores and possibly much more violent civil disorder? The seeds are being planted for something this country might never have seen before. When a government becomes corrupt and bought by big business interests, it is just the beginning.
The only way to begin a new process is by raising taxes on the wealthy, stopping home foreclosures, not touching entitlement programs, and reducing defense spending by only ten percent (approximately seventy billion dollars per year.) In ten years the deficit could be reduced by approximately two trillion dollars. That way, though people will struggle, at least things might not get worse. Unemployment insurance will continue, people will not go hungry, stabilization will begin to take place, unemployment could begin to wane, and the government funding would be raised during a recovery by increased taxes. We must close hedge fund loopholes, and executives at private equity firms must no longer pay a capital gains tax of only fifteen percent. This would produce billions of dollars each year by itself in revenue.
What about the stock buybacks? Another cruel hoax on the people of America. Fewer shares of stock in circulation of a company result in earnings per share rising. This occurs even if growth is stalled or decreasing. Guess who benefits? You’re right—big corporate executives meet their goals for profit growth, and big bonuses are paid. This occurs with poor stock performance. Earnings per share should and must be adjusted to reflect this purchase or buyback of company stock. This year Pfizer increased its buyback or stock re-purchases to approximately eight billion dollars. That is about all the money it set aside for buybacks for the next five years. The game is lay off workers, buy back stock, increase unemployment, raise falsely the price, and give all the boys upstairs the big bucks. On June 23rd of this year, Campbell Soup Company said it would buy back one billion dollars more in stock. Five days later it eliminated seven hundred jobs. Hewlitt-Packard announced a ten billion dollar buyback in July and gave five hundred people in September their pink slips. Since then more people have been fired at Hewlitt-Packard.
Buybacks, bonuses, salaries, etc., are hindering research and development vitally needed for real corporate growth. At the same time, unemployment grows. Some public companies even borrow money to buy back stock, to inflate stock prices and earnings per share. Where are the board of directors? Probably all are involved in this masterful deceit.
Capitalism (if we even had true capitalism) is run amok. Don’t these people realize they are destroying the system that made them successful? Isn’t there any conscience for the less fortunate in our society? Do they realize the results could be catastrophic for the United States?
Where are the moral, ethical and religious values of our leaders? How can a country allow politicians to be bribed, bought, and sold with no conscience? It has just been brought to public view that there is extensive inside trading going on for years by members of the House and Senate. More about this later.